NEW DELHI, India March 20 (NNN-Xinhua) -- British telecom giant Vodafone and India's third-largest mobile network Idea Cellular Monday announced a merger to create the country's largest telecom operator, ending months of speculation about the deal.

The combined company will have some 400 million customers, accounting for 35 percent of the market share in India, both the telecom firms said in a statement.

"The combined entity of Aditya Birla group's Idea Cellular and Vodafone India will have the widest network in the country and pan-India 3G/4G footprint," it added.

"The landmark combination will enable the Aditya Birla Group to create a high quality digital infrastructure that will transit the Indian population towards a digital lifestyle and make the government's Digital India vision a reality," Aditya Birla Group chairman Kumar Mangalam Birla, told the media after Idea's Board approved the merger in the morning.

Vodafone and Idea expect the merger to complete by 2018 as the deal is subject to approvals from different regulatory agencies in India.

At present, Bharti Airtel is the biggest telecom operator in India. But analysts say the merger was actually to beat the cut-throat competition from a new telecom operator, Reliance Jio, owned by India's richest man, Mukesh Ambani, and offering services at very cheap rates leading to "vicious price war".

Over 10 telecom operators are currently battling it out to try and attract India's 1 billion mobile phone users, which has forced companies to keep tariffs low, significantly impacting their profitability.--NNN-XINHUA